Michiganders sue Trump dept. over Medicaid work requirements

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Four Michigan residents filed a lawsuit Friday against the U.S. Department of Health and Human Services (DHHS), challenging the President Trump administration’s approval for a waiver that conditions Medicaid coverage in Michigan upon work requirements. 

The requirements are set to take effect on Jan. 1 and the state has been preparing recipients for the changes.

By restricting access to Medicaid through these requirements, plaintiffs argue that the proposed requirements will more than likely result in loss of coverage for Michigan’s low-income individuals and families in particular. The plaintiffs are Andrea Young, Maria Yaakovchik, Jamie Arden and Katina Petropoulos. DHHS Secretary Alex Azar and Seema Verma, administrator of the Centers for Medicare and Medicaid Services, are defendants.

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Legislation establishing work requirements were signed by Republican former Gov. Rick Snyder last year. They include a mandate for beneficiaries to report 80 hours of work to the DHHS each month or risk losing their medical coverage. Snyder has pushed for Michigan in 2014 to expand Medicaid under former President Barack Obama’s Affordable Care Act, which resulted in about 650,000 more Michiganders gaining health insurance.

Gov. Gretchen Whitmer in September signed bipartisan legislation aimed at stemming some of the damage associated with the addition of work requirements to Medicaid coverage.

Section 1115 of the Social Security Act gives the Trump-appointed DHHS secretary fairly wide-ranging authority to use Medicaid funds for initiatives like the Medicaid waiver — like what Michigan was granted — as long as the secretary determines that the initiative fits within a broad set of objectives. The section also lets the secretary waive certain Medicaid law provisions so states have more control over their individual programs.

The class action complaint lodged Friday alleges that the federal department’s actions threaten “irreparable harm to the health and welfare of the poorest and most vulnerable in our country.” 

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The plaintiffs are represented by the National Health Law Program, the Michigan Center for Civil Justice and the Michigan Poverty Law Program.

“We will be reviewing the lawsuit. We generally don’t discuss pending litigation,” Michigan DHHS spokesman Bob Wheaton wrote in an email. “At this point, that’s all we have to say.”

Similar lawsuits are challenging waiver projects in four other states.

Arkansas was the first state to implement Medicaid work requirements. In June, a study showed that the legislation was not working like proponents say it would: the state’s employment rate had not improved, and the primary result was widespread losses in medical coverage.

Study: Medicaid work requirements failed to increase employment rate

“A recent study estimates that between 61,000 and 183,000 people will lose coverage due to the work requirements alone. It’s not hyperbole to say that this law will lead to illness and death for individuals who lose their health care coverage,” said Lisa Ruby, a public benefits law attorney for the Michigan Poverty Law Program.

The Michigan League for Public Policy, a nonpartisan Lansing think tank, applauded the lawsuit and called for a halt to the implementation of the new requirements last year. 

“All along we have said that the best remedy for Healthy Michigan enrollees is to stop work requirements before they start …” Gilda Jacobs, MLPP president and CEO, said in a statement. 

“Medicaid is a supportive health program and should not be altered in such a way as to make it punitive and ineffective,” Jacobs continued. “We hope today spurs legislative action to put these work requirements on pause until this court case is settled. Affected Michigan residents shouldn’t have to wait on the courts — or experience unnecessary issues and coverage losses — for their elected officials to act.”